DFA sells its stake in Southern Belle Dairy

Dairy Farmers of America, Inc. (DFA) on Tuesday confirmed the sale of the operational assets of Southern Belle Dairy Co. LLC and the resolution of the anti-trust lawsuit filed against DFA by the Department of Justice (DOJ) and the Commonwealth of Kentucky.

The DOJ and Kentucky filed the lawsuit against DFA in April 2003 alleging that DFA’s acquisition of a partial, non-managerial ownership interest in Southern Belle Dairy, lessened competition for the sale of milk to schools in parts of Eastern Kentucky and Tennessee. In August 2004, the Federal District Court awarded DFA summary judgment; this Court’s order was overturned by the Court of Appeals in 2005, and the matter was remanded back to the Federal District Court for trial. Although DFA disagreed that competition was impacted, DFA, to bring closure to this matter, agreed to divest its interest in Southern Belle’s operation.

DFA concluded that obtaining resolution of this lawsuit would permit DFA to more fully focus its time and resources on the economic well-being of its dairy-farmer owners.

DFA partnered with the Allen Family Limited Partnership (AFLP) to acquire the Southern Belle operations. As part of the agreement with the DOJ, AFLP also sold its interest in Southern Belle.